UK: leading the low carbon revolution
The UK is strongly outperforming its peers in the G20, achieving a decarbonisation rate of 7.7% that places it at the top of this year’s LCEI. This is almost three times the global average of 2.6%.
Emissions fell 6% in 2016 while GDP grew modestly at 1.8%. The emissions reduction is mainly attributed to a decrease in total energy consumption and a continued transition from coal to gas.
Despite higher demand for heating as a result of cooler temperatures in 2016, total energy consumption fell by 2% as a result of efficiency improvements.
More importantly for carbon reduction, however, were the plans to close all coal power stations by 2025. Three major coal plants shut down in 2016. Coal production in the UK dropped from 2,784,000 tonnes in 2015 to 22,000 tonnes in 2016, as the last deep coal mine in the UK closed in December 2015. Low global gas prices meant that the gap in power demand is served by gas; gas imports increased by 7% and domestic production by 2%.
Output of renewable electricity generation was mixed in 2016. Solar generation increased by 36% in 2016 and exceeded coal generation between April – September 2016, but hydro and wind power fell, due to low rainfall and wind speeds respectively.
The UK also leads the G20 in having the highest average decarbonisation rate since 2000. The carbon intensity of the UK has fallen this century by 3.7% a year on average, the highest of the G20 countries. Whilst impressive, the British transition away from coal is almost complete. To maintain its position as a climate leader, the UK will need to tackle other emission sources, in particular in heating and transport.
China: tackling coal consumption
China has maintained its position as one of the top performers of the Index. This is the result of reductions in coal use and structural changes in the economy. As the world’s largest energy consumer, China accounts for 50% of global coal consumption. In 2016, coal consumption in China fell by 1.4% or 26 Mtoe (million tonnes oil equivalent). That is equivalent to the entire energy consumption for Portugal in 2016.
China’s energy policies have shifted in recent years. Its new energy and environmental policies, as part of the “war on pollution”, halted construction of coal fired power stations between 2016 and 2020 and has supported renewables. China maintained its lead in installing the most renewable energy power capacity and overtook the US as the world’s largest consumer of renewables. Solar generation increased by 72% and wind by 22%.
However the continued shift in the composition of China’s economy also played a role, as China’s services sector grew faster (7.8%) than the secondary (6.1%) and primary (3.3%) sectors. These lower carbon services sectors now account for 49% of China’s GDP.